Are You Really Ready to Sell Your Home?

Listing just to see what happens may seem like a good idea, but putting a home on the market too soon can backfire in a big way.

Selling a home does not happen overnight. Typical sellers reach out to a real estate agent or start researching their home’s value online many months — sometimes even years — before they are ready to put the “For Sale” sign in their yard.

Often, a home sale is the result of some life event: a marriage, divorce, death in the family, retirement or another child. It’s typically hard to “time” these events; therefore, it’s not easy to time a real estate transaction. Here are some points a potential home seller should consider before deciding to list their home.

If you’re not certain, you’re not ready

If you don’t have a new home to move into or a plan once you sell your home, it’s not a good time to list your home for sale. Sellers without a real and concrete plan are not serious sellers, but only opportunistic.

A seller without a plan will likely be “testing” the market, and that translates into overpricing the home. If the seller overprices the home, it’s not going to do her any good. The market is smart, and rarely will a knowledgeable and active buyer overpay for a home.

Ask yourself, “If I get an offer and sign a contract for a 45-day close, do I know what I will do?” If the answer is no, you should simply not list, or you will do yourself more harm than good in the long run.

Once you list, the clock starts ticking

Today, with access to so much information online, buyers will know the good, bad and ugly when it comes to listing history and data.

If you list your home at too high a price or in poor condition, you risk sitting on the market, without offers and likely without any showings or potential buyers.

That lack of interest will follow you. Once you’re ready to sell your home at the right price or in the right condition, every buyer will know your history. They’ll see the series of price reductions, the old photos, or the previous listing when you were not ready to sell.

All of the old listing activity sends a message to buyers that there is something wrong with the home or with you. Buyers will hold back on such a stigmatized home, and instead focus on a newer listing that is priced right and shows well.

You can plan for the market, not time the market

If you know that your third child is on the way, or that your new job is too far from your current home, you’ll have the luxury of not being under the gun. This allows you to take advantage of market conditions, as opposed to timing the market.

Knowing that you will list the home in the spring or the fall or in February will enable a smart seller to prep the home, make the necessary improvements and get the property market-ready.

Working with a good local real estate agent, you should watch the inventory come and go, see the competition and get the word out at the right time. If a comparable home gets three offers in less than a week, then you know two other buyers are out there. Being ready to go, you can then capitalize on the market conditions.

Real estate transactions happen all year long

Some of the most successful sales happen in the dead of winter when inventory is low, but buyers are still out. Have a sales plan months in advance. Never list your home before you (or the home) are ready.

Many homeowners are emotionally attached to their homes, but listing it at a high price or not making the necessary improvements sabotages their ability to sell it. If you find yourself struggling with the process, don’t list your home yet. Take a step back and wait. The right time will come, and waiting will ensure that you get the most from your investment.

 

 

Written By: Brendon DeSimone
Source: Zillow

Spring Housing Season Kicks Off with Short Supply

Open House signage is displayed outside of a home for sale in Redondo Beach, California.
Patrick T. Fallon/Bloomberg/Getty Images

On a snowy Tuesday in early February, Jessie and Mark Sciulli toured a home in the northern suburbs of Washington, D.C., that wasn’t listed for sale yet. Relocating their family back home from overseas, the couple was in town for just two days and had to see as much as possible. Their agent didn’t have enough active listings to show, so she went after homes she knew were coming soon.

It is the same story for home buyers nationwide: There is precious, record little for sale.

“I feel like there is not a lot of inventory right now, so that does make us a little bit nervous, because we think there is going to be a lot more offered in two or three weeks, so I’d say for sure we feel that stress,” said Jessie.

Presidents Day weekend is traditionally seen by real estate agents and homebuilders as the start of the spring housing market — the busiest time of year for home sales. The number of listings always rises, and it will this year as well, but inventory is already so low to begin with that even the new listings will not be nearly enough.

“I think inventory is going to remain tight. The closer you are to urban centers, the tighter the inventory, because the demand is strong, and a lot of that stuff gets scooped up before it hits the market,” said Jane Fairweather, a real estate agent in Bethesda, Maryland.

The latest numbers paint an empty picture. Inventory at the end of December nationally was down nearly 4 percent from the previous December, but sales were up nearly 8 percent, according to the National Association of Realtors. The supply of homes for sale was the lowest since the start of 2005, and back then there were far more homes being built to add to overall supply. As for January, the NAR’s listing site, Realtor.com, reported that listings were down a sharper 4.4 percent from a year ago.

In local markets, the January readings are coming in even tighter. Total listings in Charlotte, North Carolina, dropped nearly 24 percent in January from a year ago, with the number of new listings down 6 percent. In Denver, more than 4,000 homes came onto the market in January, but total inventory remained at historically low levels. Buyers scooped up more than came on.

January inventory was down nearly 17 percent in Philadelphia from a year ago, and Washington, D.C., had so few listings it would take less than two months at the current sales pace to exhaust supply. A healthy housing market traditionally has four to six months’ worth of inventory for sale.

“Half the [D.C.] homes sold in January were on the market for 26 days, and the competition among buyers pushed the average percent of asking price received at sale up to 98.6 percent,” according to the Greater Capital Area Association of Realtors. “The $504,250 median price for the month was slightly higher than last year (1.9 percent) and marked the highest January level on record for the District.”

“The inventory question is a puzzle,” said Chris Herbert, managing director of Harvard’s Joint Center for Housing Studies. “If you drill down and say, what’s happening at the lower end of the market, what’s happening in more affordable neighborhoods, those places had a much more dramatic boom-bust in house prices. Even though prices have come back there pretty strongly, they are much more likely to be underwater or low equity, so I think part of it is even though we think we have seen the market heal, there’s still a lot of healing left to do.”

Herbert also points to younger baby boomers, who lost home equity and more in the recession, and who are not trading up as much as their age group historically does. They are staying put in their homes, not adding to much-needed inventory. Add it up and it comes out to less — less inventory, which in turn puts upward pressure on prices.

Sellers, however, appear to be seeing a limit. They are not pricing their homes as aggressively as they did last fall, according to real estate brokerage Redfin. While homes are selling fast, not everything sells, especially if it’s overpriced. Sellers know the only thing worse than not getting top dollar is sitting on the market and becoming a “stale” listing.

“Even with surging home prices, listings were still down in January from a year ago,” said Redfin chief economist Nela Richardson. “Sellers are worried that today’s buyers won’t pay enough for their current home to finance their next-level house.”

Back in suburban D.C., after an exhausting two days and 19 home tours, the Sciullis left without making any offers.

Several of the homes they saw were not listed yet, including their top choice. That home will go on sale soon, but at a price the Sciullis think may be a little high for the market.

“We just have to make sure we’re getting it at a price point that we’re comfortable with and that we can manage,” said Mark.

The Sciullis are going to wait and see if it gets any other offers; if not, they’ll jump on it fast.

Written by Diana Olick of CNBC

(Source: CNBC)

 

Here’s a Part of the Housing Market That’s Really Booming

Mike Blake/Reuters

The turmoil in the stock market hasn’t hurt homeowners’ plans to spend on their properties this year, according to a new Angie’s List survey.

The survey found that among homeowners who’ve already set their spending budgets for 2016, nearly 79 percent plan to spend as much or more on home improvement projects compared to last year.

That’s good news for service providers, who are also optimistic about 2016. More than 90 percent of them said they expect homeowners to spend as much or more on projects as they did last year.

The survey found that millennials plan to spend as much as or more than older homeowners on home improvements.

The Angie’s List findings confirms a report issued by the Joint Center for Housing Studies at Harvard University last month, which projected that home remodeling would pick up this summer. The Leading Indicator of Remodeling Activities projected that annual spending on home improvement projects in 2016 could surpass its 2006 peak, on nominal terms.

The report shows expected home improvement spending of $148 billion in the second quarter of this year, followed by $155 billion in the third quarter.

Home-improvement projects are making more sense as an investment than they have in recent years. While most renovations don’t pay off dollar-for-dollar when you sell a home, the return on investment for remodeling projects in 2015 increased to 64.4 percent in 2016, up from 62 percent in 2015 and the second-highest return in the past eight years, according to Remodeling magazine. 

Written by Beth Braverman of Fiscal Times

(Source: Fiscal Times)

 

How Healthy is Your City’s Housing Market?

Provided by USA Today
Provided by USA Today

Boston has happy home buyers, while Las Vegas lacks reliable residents, according to a new study.

WalletHub, a consumer finance website, looked at how the housing recovery affected consumers across the country. Having the right type of financing could set home buyers up for success — and the risky kind could set families up for failure down the road, said WalletHub spokeswoman Jill Gonzalez.

So WalletHub ranked 25 metropolitan areas on homeowners’ “financial freedom,” using data from the Census Bureau’s American Housing Survey. Researchers looked for signs of a healthy housing recovery: places with high home equity, a short amount time left on mortgages, and where a buyer with an average credit score could get an affordable interest rate and down payment of less than 20%.

The researchers also doled out black marks against cities with potentially risky borrowing, like “easy” mortgages. If a high percentage of buyers were using government assistance,  had a home equity line of credit or a lump-sum home equity loan, or owed more than their house was worth, the city moved down the list.

The complete rankings (by metro area):

1. Boston

2. Oklahoma City

3. San Antonio

4. Northern New Jersey, NJ

5. Hartford, Conn.

6. Austin

7. New York City

8. Rochester, N.Y.

9. Philadelphia, PA-NJ not sure why NJ is in there, but Philly is a stand-alone city

10. Houston

11. Louisville

12. Nashville

Tie #13 Baltimore

Tie #13 Washington, D.C.

Tie #13 Chicago

16. Detroit

17. Miami-Hialeah

18. Richmond-Petersburg, Va.

19. Seattle

20. Jacksonville

21. Minneapolis-Saint Paul

22. Tucson

23. Orlando

24. Tampa-Saint Petersburg-Clearwater

25. Las Vegas

Metro areas with high equity values, low interest rates and strict lending practices show promise for a stable housing market recovery, Gonzalez said, while cities near the bottom still face challenges.

Consider the percentage of “underwater” mortgages: where the consumer owes more on the home than the home’s value. Nationally, about 15% of mortgages fall in to this category, WalletHub said. Fewer than 7% of mortgages in Boston would be considered “underwater,” while in Las Vegas, that figure is close to 40%.

Similarly, fewer than 10% of mortgages in Boston were obtained with no proof of income, assets or debt. In Tampa, that number is close to 24%, well above the national average of 17%.

“Each city has its own obstacles to overcome,” said Gonzalez. “A place that is bringing in more young people, like Boston and New York, that’s going to be setting more people up to be buying than somewhere like Las Vegas.”

Jeff Taylor is a managing partner at Digital Risk, an analytics company for mortgage lenders. He said there are a variety of regional trends that can affect a local housing markets, from first-time buyers looking to save money on rent, to foreign, all-cash purchases of pied-a-terres. 

“Nationally we have absolutely stabilized, but we still have two dynamics going on,” Taylor said. “There are areas that will see price increases that’s based on high demand, like Miami and San Francisco. In Orlando or the Midwest, prices are growing more slowly as inventory has not made its way through the foreclosure process.”

The study is not the first to show the housing market mounting an uneven recovery. While cities such as Denver and San Francisco are seeing home values skyrocket, others are seeing steady, but tapering, growth, according to the S&P/Case-Shiller Home Price Index, a measure of housing prices in 20 major American cities that was released Tuesday.

“We have outliers, like Orlando,” Taylor said. “But as a country, we are heading in the right direction.”

Written by Anita Balakrishnan of USA Today

(Source: USA Today)

What Happens When Tech Workers Come to Town

© Provided by CNBC
© Provided by CNBC

Technology workers are increasingly looking beyond Silicon Valley for a place to call home, eyeing cities like Seattle, Denver and Austin, Texas, as their companies open new offices across the country. And it’s impacting housing prices.

When technology workers enter a metropolitan area’s real estate market, housing prices are likely to increase, according to a recent study by real estate company Redfin.

For every 1 percent increase in technology workers, there’s roughly a half percent rise in home prices above the national rate of appreciation, the study found.

The study tracked the hiring data of the four largest Internet-related companies—Google  (GOOGL), Apple  (AAPL), Facebook  (FB) and Amazon (AMZN)—in six metropolitan areas, including Silicon Valley. The hiring data from these companies were used as a proxy for overall technology hiring in the areas.

Seattle and Boston have the largest growth rates in technology hiring with a year-over-year increase in technology workers of 21 percent and 17 percent, respectively. As a result, Redfin believes that housing prices will increase the most in these areas.

It is important to note, however, that Boston only saw a 3 percent rise in year-over-year home price increases, despite having the second-largest uptick in technology workers. The authors attributed this discrepancy to people leaving Boston for warmer climates.

For now, Silicon Valley still holds first place for housing price inflation above the other cities surveyed at a 22.2 percent increase in year-over-year home prices.

But other cities are catching up. Denver saw an increase in home prices of approximately 17 percent, Austin 15 percent and Seattle 13 percent.

What’s driving housing prices up? Technology workers’ high salaries and their increasing wealth from stock-based pay.

Apple, Facebook and Amazon have all seen stock appreciation at or above 25 percent since last June. Google saw a 4 percent depreciation, the study noted.

Because of their growing wealth, technology workers are often the ones driving bidding wars to new, groundbreaking levels.

“We always knew at a vague level that the expansion of the technology-driven economy was affecting the American city, but now we see by how much,” said Glenn Kelman, CEO of Redfin, in the report.

Written by Marguerite Ward of CNBC

(Source: CNBC)

The Most Expensive Homes For Sale in Silicon Valley Right Now

Prices for homes in Silicon Valley are notoriously steep, with tech money contributing to an inflated real estate market that continues to grow in value.

Zillow helped us pull data on the most expensive listings in 14 Silicon Valley towns: Palo Alto, Atherton, Cupertino, Menlo Park, Woodside, Saratoga, Portola Valley, Los Altos, Los Altos Hills, Los Gatos, Hillsborough, Morgan Hill, Mountain View, and San Jose.

Atherton, which consistently ranks among the most expensive zip codes  in the country, made the most appearances on the list, with five of the top 11 most expensive homes overall. Several tech billionaires, including Microsoft cofounder Paul Allen, HP CEO Meg Whitman, and Google chairman Eric Schmidt, are known to own homes here.

From a Los Gatos mansion with its own helicopter pad to a historic 40-acre hill estate in Woodside, some of these Silicon Valley homes are pretty out-of-this-world.

11. 18001 Wagner Road, Los Gatos – $14.498 million

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This massive Los Gatos estate has six bedrooms, more than 20,000 square feet of space, two pool houses, a tennis court, and a helicopter landing pad. The garage has room for up to 15 cars.

10. 291 Atherton Avenue, Atherton – $14.85 million

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This seven-bedroom home in ritzy Atherton has a sweeping driveway lined with palm trees. Inside, you’ll find high ceilings, dramatic chandeliers, and a gourmet kitchen. Additional amenities include a sauna, swimming pool, and tennis court.

9. 333 Atherton Avenue, Atherton – $16.8 million

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Located about three minutes further south on the same Atherton street, this property includes a two-bedroom guesthouse in addition to the six-bedroom main house.

8. 132 Isabella Avenue, Atherton – $18.35 million

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According to the listing, this Atherton home has more than 17,300 square feet of space. Amenities include a home theater, wine cellar, two-bedroom guesthouse, and an elevator to access all three floors.

7. 1225 San Raymundo Road, Hillsborough – $19.75 million

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Further up the Peninsula in Hillsborough, this 12-bedroom home sits on a three-acre lot. It has some pretty extravagant decor — including intricately molded ceilings — and a vineyard in the backyard.

6. 1 Faxon Road, Atherton – $20.7 million

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With more than 12,000 square feet of space, this Atherton home would make for a lavish family retreat that is just minutes away from “tech giants,” according to the listing. There’s a large pool, putting green, and a wine cellar that can hold up to 5,000 bottles.

5. 11627 Dawson Drive, Los Altos Hills – $23.995 million

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The “Rancho San Antonio” estate, located on a hilltop 5.6-acre lot, has six bedrooms and 11 bathrooms. There’s also a two-bedroom guesthouse, pool, spa, and tennis court.

4. 21116 Comer Drive, Saratoga – $24.5 million

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In the southern part of Silicon Valley, this 13,000-square-foot Saratoga home has a dramatic entryway. Inside, you’ll find seven bedrooms, 12 bathrooms, a home theater, infinity pool, cabana, and an au pair suite.

3. 52 Atherton Avenue, Atherton – $28 million

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This 9,000-square-foot home in Atherton belongs to a prominent Silicon Valley financier. The house sits on nearly three acres of land, complete with a guest house, pool, tennis court, and expansive gardens.

2. 700 Kings Mountain Road, Woodside – $28.89 million

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This 14,000-square-foot mansion is set on park-like grounds in Woodside. According to the listing, the home boasts four separate master suites, a 13,000-bottle wine cellar, and “award-winning gardens.”

1. 331 Greer Road, Woodside – $39.98 million

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Built in 1941, the Flood Estate sits on more than 40 acres of gorgeous rolling hills. The property includes plentiful gardens, a gatehouse, tennis court, swimming pool, and colonial-style main house with nine bedrooms. Previously listed for $85 million in 2012, the price was chopped to $69.8 million in 2013, and then to $39.98 million in May 2015.

Written by Madeline Stone of Tech Insider

(Source: Business Insider)